Jay P. Greene has written a post on his blog today that should, if there were any justice, be inscribed on letters of gold blazoned across the sky. But since there isn’t any justice, I’ll quote from it liberally right here:

The problem is that foundations are no substitute for market forces in identifying what works and what doesn’t for kids. Rather than focusing on picking winners and losers, foundations should focus on pushing the idea that we need stronger market forces.

Jay is talking about the results of a new report released by Andrew Coulson at Cato today, which tracked the performance of students at various charter school networks in California. Coulson compared the most successful schools with the support given by philanthropies. Coulson’s conclusion is dire:

The results are discouraging. There is effectively no correlation between grant funding and charter network performance, after controlling for individual student characteristics and peer effects, and addressing the problem of selection bias.

Jay’s point is not that philanthropies are betting on and backing the “wrong” educational strategies, but that they are insufficiently respectful of the market’s ability to tell us what works and what doesn’t work.

There is a danger that foundation officials will begin to imagine that they know what people should want, just like government officials, academics, and D.C. pundicrats often do, rather than allowing people to figure out what works for them. Foundations, like government, can play a useful role by trying to create sensible rules for markets so that they can function efficiently. They can also alleviate particular suffering and misfortune. But if they start focusing the bulk of their money on picking winners and losers in the educational marketplace, they are very likely to get it wrong. Central planning doesn’t work any better for foundations than it does for governments.

I don’t want to dilute the power of Jay’s message here about the power of markets, so hold that thought.

Then go on to read his whole post to see the ballsiest fellow in education reform today in his best form, biting every feeding hand he can reach.

Foundations, he says, are just as corruptible as corporations, but more so, because they have no competitors. “… Corporations suffer the consequences of . . . hubris. If they stray from their mission and become swollen with power-seeking administrative bloat, they tend to lose in the marketplace to leaner, more focused organizations.” But not, says Jay, foundations like “Gates, Ford, Carnegie.” They “have the funds to keep foisting foolish ideas on people for a long, long time without any accountability.”

And just to work off some excess energy, Jay ends with a final jump on Gates, observing that during a period when its assets doubled, its staff increased tenfold.

When Foundations, Not Markets, Pick School Reform Winners, Children Lose was last modified: June 7th, 2011 by Sam Schulman